“We believe this concern is overblown,” Shope wrote. “While some carriers will attempt to reduce the subsidy burden and tighten upgrade policies, many more will likely hold steady to capture share from the latter camp. In the end, all carriers are attempting to migrate their installed bases from feature phones to data-centric smartphones, and amid this transition, we think the risk of losing market share in the iPhone sub-segment is likely to be too great to ignore.”

The analyst continued, “On a shorter-term basis, we believe the building rhetoric for lower subsidies and tighter upgrade policies is likely to fade to a whimper, as vendors prepare their marketing strategies for the iPhone 5 refresh later this year.”